U.S. Is Urged to Keep Global Banking Goals as EU Reacts to TrumpBy
The European Union’s finance chief called on the U.S. not to abandon efforts to enact global bank capital standards amid signals the new administration will try to dismantle regulations put in place since the financial crisis.
“We must see what the U.S. administration is really doing and then see how we actually react,” Valdis Dombrovskis, an EU vice president and commissioner, told Bloomberg while in Copenhagen on Friday. “The message we’re sending to the U.S. administration is that it’s important to continue with international cooperation in this field.”
President Donald Trump has stepped up his criticism of financial regulations, vowing for example to overhaul the 2010 Dodd-Frank banking legislation. Talks in the Basel Committee on Banking Supervision have also stalled amid disagreements over how to stop banks using their own complex models to reduce capital requirements, four people familiar with the matter said last month.
Asked whether there’s a danger that disagreement over how to complete Basel III could continue beyond March, Dombrovskis said it is difficult to “comment on negotiation possibilities.”
“I’ve commented on what our approach is and said that in the last round of negotiations the EU member states represented in Basel were actually gracefully trying find a solution,” he said.
The Basel Committee has already missed a January deadline to deliver new rules. Once an agreement is reached, the regulator’s oversight body, whose next meeting could come in mid-March, must approve the final standards. The Basel Committee meets next on March 1-2.